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  • Economic comparison of electric fuels produced at

    excellent locations for renewable energies:

    A Scenario for 2035

    Philipp Rungea,e, Christian Sölchb,e, Jakob Albertc,e, Peter Wasserscheidc,d,e,

    Gregor Zöttlb,e, and Veronika Grimm*a,e

    a Chair of Economic Theory, Friedrich-Alexander-University Erlangen-Nürnberg (FAU), Lange Gasse 20, D-90403

    Nürnberg, Germany

    b Professorship of Industrial Organization and Energy Markets, Friedrich-Alexander-University Erlangen-Nürnberg (FAU),

    Lange Gasse 20, D-90403 Nürnberg, Germany

    c Institute of Chemical Reaction Engineering, Friedrich-Alexander-University Erlangen-Nürnberg (FAU), Egerlandstrasse

    3, D-91058 Erlangen, Germany.

    d Forschungszentrum Jülich GmbH, Helmholtz Institute Erlangen-Nürnberg for Renewable Energy (IEK-11), Egerlandstr.

    3, D-91058 Erlangen, Germany.

    e Energie Campus Nürnberg, Fürther Str. 250, D-90429 Nürnberg, Germany.

    June 10, 2020

    Abstract

    The use of electric fuels (e-fuels) enables CO2-neutral mobility and opens therefore an alternative to fossil-fuel-

    fired engines or battery-powered electric motors. This paper compares the cost-effectiveness of Fischer-

    Tropsch diesel, methanol, and hydrogen stored as cryogenic liquid (LH2) or in form of liquid organic hydrogen

    carriers (LOHCs). The production cost of those fuels are to a large extent driven by the energy-intensive

    electrolytic water splitting. The option of producing e-fuels in Germany competes with international locations

    with excellent conditions for renewable energy harvesting and thus very low levelized cost of electricity. We

    developed a mathematical model that covers the entire process chain. Starting with the production of the

    required resources such as fresh water, hydrogen, carbon dioxide, carbon monoxide, electrical and thermal

    energy, the subsequent chemical synthesis, the transport to filling stations in Germany and finally the energetic

    utilization of the fuels in the vehicle. We found that the choice of production site can have a major impact on

    the mobility cost using the respective fuels. Especially in case of diesel production, the levelized cost of

    electricity driven by the full load hours of the applied renewable energy source have a huge impact. An LOHC-

    based system is shown to be less dependent on the kind of electricity source compared to other technologies

    due to its comparatively low electricity consumption and the low cost for the hydrogenation units. The length

    of the transportation route and the price of the filling station infrastructure, on the other hand, clearly increase

    mobility cost for LOHC and LH2.

    Keywords: Electric fuels, Hydrogen Utilization, Hydrogen Import, LOHC, Mobility

  • 2

    1. Introduction

    The energy supply of most economies in 2019 is strongly dominated by fossil fuels. In order to

    achieve the 2° target formulated in the Paris Climate Agreement, this share must be drastically

    reduced [1]. In many applications, fuel substitution by direct electrification is possible and

    reasonable. Examples are the use of heat pumps to provide heating for buildings or battery-powered

    mobility systems for individual transport in the short- and medium-haul segment [2].

    In other sectors it is much more difficult to replace fossil fuels. Especially in some segments of the

    mobility sector, liquid fuels have considerable advantages over batteries due to their high energy

    density and simple re-fuelling systems. This applies in particular to aviation and shipping, but also

    to non-electrified railway lines, trucks, building machines, mining machines and cars on long-haul

    journeys [3–5]. The sustainable synthesis and use of these fuels can be an appropriate way to

    defossilize the abovementioned applications. For this purpose, established fuels such as diesel,

    kerosene or methane can be used, or new fuels, such as hydrogen, methanol, ammonia or dimethyl

    ether may be established.

    Synthetic fuels can be produced in a number of different ways [6]. In this paper, we examine the

    generation of synthetic fuels using hydrogen from electrolytic water splitting. The production of so-

    called electrofuels, electric fuels or e-fuels is highly energy-intensive. Hence the electricity costs are

    of considerable importance for the total costs of the fuels. It may therefore be an interesting option

    to produce the fuels at locations where the the levelized cost of renewable electricity are particularly

    low and high capacity utilization rates (CUP) are to be expected. The energy-dense fuels can then

    be transported to the world's energy consumption centres at comparatively low costs. This paper

    therefore compares different locations with regard to their suitability for low-cost e-fuel production

    und transport to Germany and also distinguishes between four widely discussed e-fuel candidates.

    Niermann et al. [7] and Reuß et al. [8] compare the transport cost for different e-fuel like compressed

    or liquid hydrogen, N-ethylcarbazole, dibenzyltoluene, 1,2-dihydro-1,2-azaborine, formic acid,

    methanol, naphthalene, toluene for different transport distances. Niermann et al. focus on the long-

    distance transport via tanker or pipline and Reuß et al on the supply of hydrogen filling stations by

    pipeline and truck. However, these studies do not cover hydrogen production or the energetic

    utilisation of e-fuels. The influence of the production site for the water electrolysis and the

    production of different fuels is analyzed in [9–11] for sites like Brazil, Morocco, Egypt, Somalia,

    Iceland or the German Bight. In [12–17] fuel cost are calculated in specific case studies. For

    example, in Heuser et al. [12] the LH2 transport from Patagonia to Japan is investigated, in Gulagi

    et al. [13] the transport of liquid synthetic natural gas from Australia to East Asia or in Teichmann

    [15] the hydrogen transport from Canada to Germany via liquid hydrogen or as carbazole LOHC

    system. Timmerberg and Kaltschmitt [16] show the transport of H2 from North Africa to Europe via

    pipeline.

    An analysis of the energetic utilisation of different e-fuels in light duty vehicles is provided in Runge

    et al. [18] or Bongartz et al. [19]. In Bongartz et al. hydrogen production is not part of the study, but

    the influences of hydrogen purchasing cost are varied in a sensitivity analysis. Runge et al., on the

    other hand, focus on hydrogen production under the assumption of different electricity market

    designs in Germany.

    This paper reports a techno-economic investigation of the production of e-fuels in seven regions

    worldwide, which are excellent for different kinds of renewable energies. The e-fuels examined are

    diesel, methanol and hydrogen, whereby the latter is transported either bound to a dibenzyltoluene

    (H0-DBT)/perhydrodibenzyltoluene (H18-DBT) Liquid Organic Hydrogen Carrier (LOHC) system

    or as cryogenic liquid at -253°C. The economic comparison of the fuels is finally based on the

    mobility cost. We define these as fuel costs incurred by a 100 km drive with a compact car. The

    decision to evaluate mobility cost and not only e.g. the heating value based cost of fuels is motivated

    by the fact that both, the filling station set-up and the propulsion system, differ drastically between

    the technologies. In our opinion, a comparison of the e-fuels with each other is only valid if the

    complete chain up to the power train is evaluated. The resulting mobility cost are only valid for the

  • 3

    compact car described. However, the relative performance is also meaningful for heavier cars, buses,

    trucks or trains by scaling.

    For the evaluation of the mobility cost we set up a mathematical model, which covers the complete

    process chain, from the electricity generation in the different regions over the fuel production up to

    the transport of the fuels to the filling stations in Germany and the energetic utilization in the car.

    The result is a process design optimized for location and fuel, which provides information about the

    best interplay of different technologies and applications.

    The paper is organised as follows. Section 2 introduces the seven different production sites. Section

    3 briefly explains all model relevant process steps and summarizes all necessary assumptions before

    the mathematical model is schematically presented in Section 4. The results are finally shown and

    interpreted in section 5.

    2. Production sites

    The production sites considered in this paper are primarily selected for their excellent conditions for

    various renewable energies. At the same time, good access to the sea is necessary to transport the

    fuels by tanker to the consumption centres in other parts of the world1. In arid areas access to the

    sea is also needed to produce fresh water for electrolysis. In addition, a low population density and

    thus low local energy demand is essential in order to produce surpluses for export. Regions where

    there had been serious political unrest in the past were also excluded from this study. The selection

    made considers the regions shown in Figure 1.

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